EU Avoids Controversy over Accounting Standards

Byline: Patrick Blum in Brussels

The European Commission has formally adopted international accounting standards (IAS) but without the two controversial clauses which relate to accounting and disclosure of financial instruments, which will be discussed separately in London this week with the IAS Board.A Commission statement said IAS articles 32 and 39 and are still being revised by the IAS Board in co-operation with European accounting experts.

Frits Bolkestein, the EU's internal market commissioner, is to meet Sir David Tweedie, the IASB chairman, on Thursday to discuss progress on the consultation process.

The EU has pressed for more discussions about the standards to ensure they better reflect the needs of the financial industry, especially over the two controversial articles which industry representatives said could cause financial instability.

The two rules would require all of a firm's portfolio to be valued at current market prices similar to the America's Generally Accepted Accounting Principles (GAAP). …

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